Is the dispute resolution by mediation or arbitration provision in the Boulder Designs Franchise Agreement subject to state law?
Boulder_Designs Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in the | Summary | |
|---|---|---|---|
| Franchise Agreement | |||
| a. Length of the franchise | Section 4.1 | 10 years. | |
| term | |||
| b. Renewal or extension of | Section 4.2 | Additional 10-year term if certain conditions | |
| the term | are met. | ||
| Provision | Section in the Franchise Agreement | Summary or modify their business relationship with Us, our Affiliate(s) or any other franchisee. | |
| s. Modification of the | Sections 9.2 and | The Franchise Agreement can be modified | |
| agreement | 22.6 | only by written agreement between you and us. | |
| t. Integration/merger clause | Section 22.6 | Only the terms of the Franchise Agreement and all exhibits to the Franchise Agreement are binding (subject to state law). Any representations or promises made outside of the disclosure document and the Franchise Agreement may not be enforceable. | |
| u. Dispute resolution by arbitration or mediation | Section 23.7 | Except for actions or claims for injunctive relief or specific performance or relating to the Marks, Trade Secrets or Confidential Information, all disputes must be mediated in McLennan County, Texas. (Subject to state law) |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 38–44)
What This Means (2025 FDD)
According to Boulder Designs' 2025 Franchise Disclosure Document, the dispute resolution process involving mediation is subject to state law. Specifically, except for actions seeking injunctive relief, specific performance, or those relating to trademarks, trade secrets, or confidential information, all disputes must be mediated in McLennan County, Texas.
This means that while Boulder Designs requires mediation to occur in Texas, the enforceability and interpretation of the mediation agreement can be influenced by the laws of the franchisee's state. State laws may dictate certain consumer protection measures or clarify how mediation clauses are interpreted.
For a prospective Boulder Designs franchisee, this implies that the legal landscape governing dispute resolution can vary depending on their location. While initial mediation is set in Texas, a franchisee's rights and obligations could be shaped by their own state's regulations, potentially offering additional safeguards or different interpretations of the agreement.